Setting up 1099 forms

- A 1099 is a tax form that you need to file with your taxesto send to your vendors and consultantswho you paid a certain amount of money toin the previous year.The IRS laws will tell you what that amount threshold isto which you have to send a 1099.For example, if you must send 1099sto any vendor or consultant to which you paidat least 600 dollars or more during the previous year,then with just a few things in place,Quickbooks can keep track of this for you.Here is what has to be in place to file and send your 1099s.

Let us take our shelter services as an example.Remember, I used the Mycat veterinary officeto do all of our shelter services.If I paid that consultant or office enoughover the course of last year,then I need to send them a 1099.The first thing that needs to happen is thatthat particular vendor needs to be marked as eligibleto receive a 1099.I will click Vendors to go into the Vendor center,then I will double click on Mycat.I'll change to the Tax Settings tab.

I am going to make sure there is a check boxnext to Vendor eligible for a 1099.In the field above, you can put their Vendor tax ID.This is going to be their federal tax ID,or their Social Security numberif it is just a single consultant.You will have to get that information from them.I'll click Ok to get out of this box.Once that is in place, the next thing that has to happenis that you need to be sure that you filed all their bills.I am going to close out of this and select Enter Bills.I am going to pull out a bill from Mycat,by clicking Find on the top left-hand side,and in the Vendor drop-down I will choose Mycat.

I will click the blue Find button,and here I can see a bill from them.It is for a large sum of moneyand if I look at the Bill Due fieldI can see that that bill was for the prior year.It is not just enough to have this bill in place though,I can look and see that it is paid.Remember that the 1099s are to whoever we send money to.So we also have to pay that bill in Quickbooks,or at least tell Quickbooksthat we have sent them that much moneyover the course of last year.So I mark them as being eligible to get 1099s,I have entered the bill and paid it.

Now we can go onto Preferences and use the 1099 Wizard.I will close out of this.I will select Edit, and then choose Preferences.All the way down at the bottom of the Preferences screen,select Tax 1099, and change to the Company Preferences tab.Make sure you have the Yes radial button selectedon the Do you file 1099-MISC forms.When you are ready to run the Wizard,select Click here under theIf you're ready to prepare your 1099s.

This is going to bring up the Quickbooks 1099 Wizard.Click the blue Get Started buttonin the bottom right-hand side.The first thing you need to dois select your 1099 vendors.Remember, we already went through and told Quickbooksthat Mycat is indeed eligible for a 1099so that is why they are automatically selected here.I will click Continue.Here is where I can verify all their informationand I will select Continue again.Here is where we are going to map outour various payment accounts.Now, Quickbooks already knowsthat over the course of the previous yearI have used this Mycat shelter serviceto send Mycat more than 600 dollars worth of moneywhich is the threshold.

You can view those thresholds by the way,by clicking Show IRS 1099-MISC filing thresholdson the bottom right-hand side of the screen.It is going to bring up a listso that you can see the dollar amounts of moneythat you have to send to those vendors to file a 1099.I can see here that for Box 7: Nonemployee Compensation,the threshold is 600 dollars.I'll click Cancel to close out of this box.But here is where we apply this moneyto a certain 1099 box.In the Apply payments to this 1099 boxI can click the drop-down.

Here is where I can choose all the boxes.And indeed, Box 7: Nonemployee Compensation,is already selected.You may have more accountsthat are not showing up in this list.In fact, in this drop-down list above it,it says Show 1099 accounts.But I can choose Show all accounts.Here is where you can see all of your accountsas listed in your chart of accounts.To any account that you knowmatches one of these thresholds,you can select it in the view.You could have changed many different accountsto track all your different vendorsand to see where that money was going.

I will click Continue.Here is where you can view any payments or exclusionsbased on IRS laws.I am going to click Continue again,and now you are ready to seewhat miscellaneous 1099 forms are going to be created.So here is our vendor.Here is the Box 7 field,because over the course of last year,for all their shelter services.I compensated this company 1350 dollars.So now I am at the end of the Wizard.If I click the blue Continue buttonI will move on to actually filing this entrywhich I am not going to do because this is an example.

So I am just going to click Save & Close.I can come back to that at any timeby going back into Preferences,and choosing that 1099 form,the very bottom of the Preferences screen.As long as you have entered all your bills,and you are paying your vendors,filing your taxes for 1099s is easy.

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11/5/2015

Learn the essentials of working with QuickBooks Pro. Find out how to create and back up your company's QuickBooks file and quickly set up shop—adding your banking information, credit cards, and historical data to the chart of accounts. You'll also learn how to set up your customers, vendors, employees, and inventory items. Author Jess Stratton then takes you through the day-to-day operations that keep your business running: creating estimates, invoices, and sales receipts; processing payments; recording deposits; and printing checks. Plus, learn how to run reports, find data about your business, and close the books, with end-of-year preparations.